Interest Rates, Corporate Bonds, and Mortgage-Backed Securities
Free GARP FRM Part I lesson in Financial Markets and Products. 21 min read, ~3,194 words.
Compounding conversion:. Continuous and discrete give the same PV but different rate quotes. Duration: Macaulay (weighted-avg time), Modified = Mac / (1 + y/m), Dollar = Modified × Price.. Convexity: second-order term. Improves the linear duration estimate:. Term structure theories: expectations, liquidity preference (term premium), market segmentation, preferred habitat. MBS...
Read the full lesson, free →
Worked examples, audio narration, and practice. No signup to read.
What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- 1
- 2
- 3
- 4
- 5
- 6
- 7
- 8
- 9
- 10
- 11
- 12
- 13
- 14
- 15
- 16
- 17
- 18
- 19
- 20
Browse all free FRM Part I lessons or jump into free FRM Part I practice questions.